AFRICA- The Tripartite Free Trade Area (TFTA), an intra-regional trade agreement that allows free trade in 26 countries in the East and Southern Africa region, has come into effect after 13 years of negotiations.
The trade agreement brings together states of the east African Community (EAC), the Southern African Development Community (SADC) and the Common Market for East and Southern Africa (COMESA).
TFTA is a based on the pillars of industrial and infrastructure development as well as trade liberalization. The pact intends to enhance trade within the African continent, which currently stands at 20%.
The pact will expedite a free trade area between the signatory states. It will allow the fast-tracked movement of business persons and goods across member states, which would be facilitated through enhanced connectivity enabled by infrastructure development.
TFTA is also expected to reduce business costs across member states and enable a mutually supportive environment in the East Africa region through collaborated regulatory and legal frameworks.
The pact will eliminate tariffs on 100% of goods sold between the signatory states, which would go a long way in stimulating economic growth and industrialization. TFTA is considered complimentary to the African Continental Free Trade Area (AfCFTA), which strives to eliminate tariffs on 90% of all goods sold within the continent.
Stakeholders have welcomed the idea, praising the pact for its potential to expand trade within the African continent.
The East Africa Business Council (EABC) lauded the move in a press statement. The statement especially hailed the 100% tariff elimination, reiterating it would enable member states to leverage the trading opportunities that exist between signatory countries.
EABC also revealed in 2022, exports from EAC countries to SADC member states amounted to US$3.79 billion while imports amounted to US$3.9 billion. The EABC also revealed EAC exports to COMESA states amounted to US$6 billion in the same year, while imports were US$4.7 billion.
The pact is expected to especially benefit EAC member states because of their overlap with COMESA and SADC- Tanzania and DRC are in SADC, while Kenya, Uganda, Burundi, and Rwanda are in COMESA.
The 29 Tripartite Member States represent 53% of the African Union’s membership, more than 60% of Africa’s GDP (US$1.88 trillion), and a combined population of 800 million.
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